Analysis of India's Logistics Costs

Before making any policy intervention, it is important to estimate the overall logistics costs, including the various associated components/elements in order to understand and identify the problem areas and arrive at meaningful solutions. This NCAER report symbolises a major step in the direction of quantification of logistics costs. Such an exercise, in fact, needs to be conducted at regular intervals for estimating and monitoring the performance indicators and accordingly identifying the areas that need intervention. Hitherto, no serious attempt had been made to carry out research using a proper methodological framework for quantifying the logistics costs being incurred in India. Albeit, some estimates of the logistics costs incurred in the country are available in the public domain. However, these costs cannot be validated due to the non-availability of a framework for their estimation procedures. This also necessitates more comprehensive research in the area of estimation of logistics costs in India. In this context, the Logistics Division, Ministry of Commerce, commissioned NCAER to undertake interlinked studies for addressing the following issues related to the logistics ecosystem of India: *Route Study: Time and cost analysis of cargo movement along major routes in the country; *Estimation of overall logistics costs in India; and *Organisation of a Policy Roundtable among stakeholders to identify and tackle the challenges being faced by this sector.